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FHA : "Ignore" Foreclosures, Bankruptcy, Short Sales?

10-02-2012, 11:13 AM

This news has been reproted by seral news sources, Google it yurself:

This will be helping a lot of people, me in particular;

FHA : "Ignore" Foreclosures, Bankruptcy, Short Sales?
Major derogatory events include foreclosure, short sale, and Chapter 7 bankruptcy. The mandatory waiting period of each of the aforementioned events are as follows, assuming credit has been re-established by the borrower :

Foreclosure : Must wait 3 years before eligible for FHA-insured financing
Short Sale In Default : Must wait 3 years before eligible for FHA-insured financing
Chapter 7 Bankruptcy : Must wait 2 years before eligible for FHA-insured financing

Under the FHA's expected new plan, these waiting periods will be waived in full.

Soon, FHA-insured loans may be available to home buyers who may have been recently foreclosed upon; for whom a short sale was necessary; or for whom a Chapter 7 bankruptcy was discharged yesterday.

The FHA's new waiver on foreclosures, short sales and bankruptcies would add to the national pool of home buyers, creating buy-side demand for housing and upward pressure for home values nationwide.

FHA : "Ignore" Foreclosures, Bankruptcy, Short Sales?
Major derogatory events include foreclosure, short sale, and Chapter 7 bankruptcy. The mandatory waiting period of each of the aforementioned events are as follows, assuming credit has been re-established by the borrower :

Foreclosure : Must wait 3 years before eligible for FHA-insured financing
Short Sale In Default : Must wait 3 years before eligible for FHA-insured financing
Chapter 7 Bankruptcy : Must wait 2 years before eligible for FHA-insured financing

Under the FHA's expected new plan, these waiting periods will be waived in full.

Soon, FHA-insured loans may be available to home buyers who may have been recently foreclosed upon; for whom a short sale was necessary; or for whom a Chapter 7 bankruptcy was discharged yesterday.

The FHA's new waiver on foreclosures, short sales and bankruptcies would add to the national pool of home buyers, creating buy-side demand for housing and upward pressure for home values nationwide.

Comment

Hi PJmax, yes 100% correct, my loan Officer feels that these changes will happen in the next several months, Fingers Crossed, I will be keeping an eye on this one, they should do something, we have been Discharged for over 2 years House has been out of our names for over 1 year, Current FHA we would have to wait 3 years till the home is out of our Name ( even throught we Inc. the Home in Chapter 7 ) can not go convenatioal need 4 years out of Chapter 7 everyone has overlay's Credit unions, Portfilio banks. we are stuck, Granted if they (FHA) do change the Guidleine you still have to have Minium Dscore of 580 or have to put down 10% clean and progressive working on your credit report, have the 3.5 down MIN, and of course Quailfy, I believe no more than 36% ratio Income to Bills Mortage, etc,

I case 700 Fico score and can put down a sizable down payment Now just fingers crossed it happens

fingers crossed, I spoke to a Loan Officer that i know and he said that he feels very Postitive that these changes will happen in the next 3 months or so:

I don't know that this will really help my situation. We are past the two year bk7 discharge however Wells Fargo still has not FC on our house. We have been renting for almost 2 years and would love to get back into the market. Our mortgage is also an FHA mortgage so I cant imagine that the FHA would be interested in guaranteeing a loan for me.

FHA : "Ignore" Foreclosures, Bankruptcy, Short Sales?
Major derogatory events include foreclosure, short sale, and Chapter 7 bankruptcy. The mandatory waiting period of each of the aforementioned events are as follows, assuming credit has been re-established by the borrower :

Foreclosure : Must wait 3 years before eligible for FHA-insured financing
Short Sale In Default : Must wait 3 years before eligible for FHA-insured financing
Chapter 7 Bankruptcy : Must wait 2 years before eligible for FHA-insured financing

Under the FHA's expected new plan, these waiting periods will be waived in full.

one small postSoon, FHA-insured loans may be available to home buyers who may have been recently foreclosed upon; for whom a short sale was necessary; or for whom a Chapter 7 bankruptcy was discharged yesterday.

The FHA's new waiver on foreclosures, short sales and bankruptcies would add to the national pool of home buyers, creating buy-side demand for housing and upward pressure for home values nationwide.

WOW! I have seen online so far in a mortgage broker site I think. You would think this would be all over the media. If this is true, it will be a GAME CHANGER for a lot of us, myself included. Talk about a boost for the housing market, this would do it! I will keep my fingers crossed!

Comment

Hi Getting.. that is the Problem. The clock does not start ticking till the Home is out of your name and even through it has been IBB your home does not make a difference, the Home under current FHA needs to be 3 years period: We called and houned Wells fargo and they Agreed to do a DIL about 1 year ago: so in this example we have 2 years left, Not sure how the new Proposed FHA Guidlines may play out for you: I would rrally try to get Wells fargo to acept a DIL get it out of your name,, Do you know that you are of course are discharged, But if someone gets hurt on the property, someone breaks in and gets hurt, House catches fire burns down someone slese home etc, is it YOUR responsibility, you will be sued and it would be post chapter 7... you are stuck,,,, you need to get the huse out of your name for several reasons. call them We had a VA loan and just kept calling and finally ater like 50 calls and the correct person they took it back: thank-god

Comment

Pathfinders, I have asked wells about doing a dil however they just don't seem interested. Every person tells me that I must try a short sale before they will do a dil. How long did the dil process take for you after someone agreed to it? Wells has also told me that since we have adequate income to afford the mortgage that a dil is not an option. Its very frustrating.

Comment

Why would the politicians push the FHA to issue more loans, through the GSEs, just to cause another bubble? I understand the inventory issues, but this is about as speculative as Congress allowing bankruptcy court judges to reduce principle balances on mortgages. I don't think FHA can arbitrarily do this and it would need to go through Congress.

Comment

Hi it took about 3 months they asked for Income statements and we told them no No of there business the debt was Discharged, Maybe a little Different we got the Va involved, WF did the DIL with out any Income verifaction, you are discharged, it does not make any difference if yu are making 500K per year, they have no reason to see anything, i have heard of some people doing a quick claim deed back to the bank, althrought I have not heard a lot of potitive outcomes, are you chatting with lost Mitagation, hell it is a pain in the Butt go ahaed and just do the short sales for them, are they sking to see Income to do the short sale as well???? i kept calling till i got someone that knew what they were tallking about, a lot of stupid people in Loss Mitiagation.

Comment

Just broke FHA does not need congress approval, it would not be a bubble , peole still need to quailfy, have a steady Job stable rent history Money to put down good debit ratio, reverves in the bank to cover for example 3-6 months emergenct fund, granted vast majority of CHapert 7 13 will not help or the 13-20 Million Unemployeed but for some where been dischard for a a few years and the back finally took the home back, have workd to get there credit back to in out case 700 Fico and can put down 10-20% that will give a smaill bounce,

Comment

Yes I am dealing with loss mitigation. They set up an account specialists and she is the only one that will talk to me about the loan. I have tried to speak to other people and they always tell me I will have to talk to her and that they can not help me. I did look into the whole short sale thing however just like a dil, wells wanted a hardship letter, tax documents, w2's, paystubs and I just refuse to send them anything on this discharged debt.